AUGUSTA – Supporters of a bill to increase publicly funded health care coverage for thousands of low-income Mainers called it a historic opportunity and a moral and economic imperative.

But opponents and skeptics said lawmakers need only look at the federal government’s fiscal problems to know that it is pitching a deal that is too good to be true.

Additional Photos

Speaker of the House Mark Eves, D-North Berwick, introduces L.D. 1066, "An Act To Increase Access to Health Coverage and Qualify Maine for Federal Funding," on Tuesday April 2, 2013 before the Health and Human Services Committee in the Cross Building in Augusta. Staff photo by Joe Phelan

Those were the prevailing arguments Tuesday over L.D. 1066, a bill to make Maine a participant in the Medicaid expansion offered in the federal Affordable Care Act, also known as Obamacare.

The public hearing, one of at least 24 of its kind held in state houses across the country this year, unfolded before the Legislature’s Health and Human Services Committee. It further framed the upcoming legislative discussion over a proposal that would provide health care coverage for an additional 55,000 to 69,000 people, according to two studies.

Maine currently has about 130,000 uninsured residents, according to health care groups.

Democrats, doctors, nurses and advocates for veterans and the poor said increasing coverage would reduce Maine insurance costs and yield better long-term health outcomes through preventative care and reduced use of emergency rooms.

Senate President Justin Alfond, D-Portland, and House Speaker Mark Eves, D-North Berwick, both said expansion is a historic opportunity. House Republican leader Kenneth Fredette, of Newport, said lawmakers should proceed cautiously.

“If history has taught us anything, it is that the federal government hasn’t always kept its promises,” Fredette said.

Supporters’ economic argument was buttressed by a recent and key participant in the expansion debate: Maine hospitals. On Tuesday, hospital representatives said expansion would reduce the amount of charity care — health care that patients either can’t or won’t pay for — that they currently provide.

Katie Fullam Harris, the lobbyist for MaineHealth, the group representing Maine Medical Center and 16 other Maine hospitals, said that continuing to provide free care could result in the closure of hospitals or higher insurance premiums.

“We respectfully submit that neither of these alternatives is in the public’s interest,” Harris said.

Hospitals have been instrumental in states that have chosen to increase Medicaid eligibility, particularly those with Republican governors. The Maine Hospital Association has taken a measured approach to expansion. It did not express outright support until last week.

The association’s announcement followed a reaffirmed commitment by the Democratic-led Legislature to work with Gov. Paul LePage on a plan to pay hospitals more than $480 million in outstanding Medicaid reimbursements.

Hospital support for increasing Medicaid eligibility also coincides with the governor’s recent receptiveness to explore participation in expansion under Obamacare. LePage has often railed against the federal health care law, calling it a “denigration” of the country’s health care system.

The LePage administration is still skeptical.

Part of the expansion would cover “able-bodied” Maine parents who earn up to 133 percent of the federal poverty level — just over $15,800 a year for an individual, or $26,951 for a family of three. The government says the states will be reimbursed 100 percent of the cost of their coverage for three years, then 90 percent after that.

But on Tuesday, LePage’s health commissioner told lawmakers that Maine’s decision to increase Medicaid eligibility in 2003 means it wouldn’t get the same deal as other states that didn’t.

Department of Health and Human Services Commissioner Mary Mayhew said that for about 41,000 parents who were part of the 2003 expansion, the federal government would maintain its current reimbursement rate of 61.5 percent. The remaining cost is paid by the state, amounting to $57.6 million in the next two-year state budget, and that cost won’t decrease if the state joins the latest expansion, she said.

She said the state’s population of about 10,000 childless adults — non-disabled people earning up to $11,490 a year — also would receive the lower federal reimbursement.

Some of the administration’s estimates directly conflicted with data compiled by Maine Equal Justice Partners, an advocacy group for low-income Mainers that belongs to Cover Maine Now!, a coalition of businesses, doctors and health care advocacy groups.

Equal Justice’s Sara Gagne-Holmes told lawmakers that the childless adult population could qualify for 100 percent federal reimbursement. She cited a recent rulemaking by the Obama administration.

The conflict over reimbursement rates was upstaged at Tuesday’s hearing by health care advocates and Medicaid recipients who argued that increasing coverage was a matter of life and death.

Some Medicaid recipients slated to lose coverage following recent legislative changes to decrease eligibility also testified.

Patricia Kidder, from Sanford, said she and her husband recently lost their coverage.

“When we limit access, such as rejecting these expansion funds and continuing the status quo, we do not eliminate the need for health care,” Madden said. “We just allow individuals and families to fall into debt and bankruptcy, and we continue to shift costs onto those who provide and have health insurance.”

A recent Harvard study found that expansions of Medicaid coverage were associated with improvement in a state population’s overall health status and a significant reduction in death rates.

Nonetheless, skeptics argued that the success of expansion was contingent on the federal government keeping its funding promise.

Fredette, the House Republican leader, urged the Health and Human Services Committee to work in a bipartisan manner and to support LePage, who he said is negotiating with the Obama administration to “get the best deal” for Mainers if Medicaid is expanded.

That deal may include allowing Maine to have more control over its Medicaid program through a so-called global waiver. The Obama administration has granted some states additional flexibility, but it’s unclear if it will green-light a global waiver that would allow states to decrease Medicaid coverage if federal reimbursement rates decline.

Alfond told the committee that Democratic leaders were glad that LePage was open to expansion. But he said the current package offered by the federal government is one Maine can’t afford to bypass.

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